Former Italian Prime Minister Enrico Letta moves to Madrid at the end of November to become the new dean of the IE School of Politics, Economics and Global Affairs. At the request of the European Commission, he has prepared an ambitious report on the future of the single market, which he will present tomorrow to the President of the Commission, Ursula von der Leyen, in the plenary session of the European Parliament in Strasbourg, as his compatriot did a few weeks ago. Mario Draghi. Last Wednesday he traveled to Seville to participate in the IV Congress of Civil Society, where he received ABC and anticipated the messages he will transmit to European parliamentarians. -In his report he warns of the risk that Europe runs of being left behind compared to China and the US. What should the EU do to prevent this? -We are in an increasingly larger world and Europe, fragmented country by country, is too small. There are many economic sectors in which instead of a single market there are 27 markets and when it comes to competing globally, fragmentation is a great gift for the Chinese and for the Americans on Wall Street. What we have done with the euro, must now be done with other sectors. -What sectors are you referring to? -In my report I identified three where this fragmentation represents an enormous weakness for Europe compared to China and the United States: energy, telecommunications and the financial market. And this last one is the most important, because the fragmentation of financial markets turns us into an American colony. All electronic payments are made with American platforms, and with each payment we make we send money to the US. Europe does not compete with the large North American investment banks. Related News standard Yes Banking reactivates mergers and acquisitions to create European champions Daniel Gentleman – In contrast to the integration that you propose, what we are seeing in many European countries, including Spain, is the rise of nationalism. – Nationalism makes Wall Street and the Chinese happy, and that is what I am going to defend in the plenary session. of the new European Parliament. Without integration the decline of Europe is guaranteed and the debate will be whether we become a Chinese or American colony. -He has also warned about the fragmentation of the defense industry in Europe.-Yes. The defense industry is totally fragmented, it is national, and the consequence is that 80% of the 140,000 million euros that Europe has spent on purchasing military material to help Ukraine, has gone to create jobs in Wisconsin, Turkey or Korea of the South, because fragmentation prevents the purchase of European military material and my proposal is to integrate the defense industry of all countries, and use the ESM (European Stability Mechanism) to finance this integration. Energy transition «It is not about delaying its application , but to reach an agreement to finance it with public and private funds» -The European Union has made a commitment to be the fastest in the energy transition. Does that make us lose competitiveness and growth? – Betting on the energy transition is a good choice, the problem is not the pace of application, but how to finance it. I know that it is an issue on which there is a lot of division, but postponing it is not the solution, it would be a weak and unambitious response. And that is what I am going to focus my intervention in the European Parliament on. There is division between the countries of northern Europe, which want the transition to be financed with private funds, and those of the south, who want a new Next Generation, financed with European public debt, and my proposal is to propose a mixed solution with public financing , but fundamentally private. And part of this solution lies in the integration of the European capital market. We have to be able to convert European private savings into investments for the green transition, that is the challenge. If we do not use this savings, it will go to the American market, which is more attractive and dynamic. And also, because if we are not able to attract this private investment, the northern countries will not accept the use of public funds. -The pandemic first, the war in Ukraine later, taught us the risks of globalization and having excessive dependence on unreliable countries. Where should Europe go? -The lesson we have received in these years is that we cannot be dependent on the energy, the connectivity, the financial markets of the rest of the world because if we do, in a world with such geopolitics complex, we are going to take too many risks. I think the first risk is having Trump as president of the United States. We have to know that if Trump is president, we have to be friends of the Americans, but independent. After Russia’s invasion of Ukraine, Europe has cut its dependence on Russian gas and oil… it has been difficult, but possible. And if Trump becomes president, measures will have to be taken. -What would it mean for Europe if Trump wins the elections? -I think that if Trump governs again, the current Trump will be more dangerous for world trade and cooperation multilateral than the previous Trump, because he already learned how to overcome the limitations that were posed to him then. And for Europe and for the competitiveness of European companies, living in an open world is essential. Defense industry “Of the 140 billion that the EU has spent on military material for Ukraine, 80% has gone to create jobs in Wisconsin” – The EU has just approved tariffs on Chinese electric cars. Do you think it is an appropriate measure or does it open an unnecessary trade war? – I think it is a good decision. In the case of China, it was necessary to send a clear message because in the last ten years we were too naive and now we are paying the bill. -One of the main problems that the EU has, and what companies complain about most, is excessive bureaucracy. What can be done to reduce it? -In the report I propose two things: the first is to create a virtual State 28 to give it its own commercial law that is valid throughout Europe. It’s not an original idea of mine. It is a copy of the state of Delaware, in the USA, which provides you with a passport with which you can operate in all American states. And furthermore, this right would be compatible with national commercial rights. And the second is to put an end to the directives, which States have to transpose and convert into national laws, which generates an enormous bureaucracy because each country transposes it in a different way. The alternative would be for Brussels to approve regulations that would be directly applied in all EU countries. -And what possibilities do you see for the new European Commission to apply these proposals? -I am optimistic. Tomorrow I will present my report in the plenary session of the European Parliament, in Strasbourg, to the president of the Commission, Ursula von der Leyen, as Mario Draghi did a few weeks ago, and I believe that the 26 commissioners have a very clear mission that coincides with many points that I raise. Furthermore, the report contains very pragmatic solutions that can be applied in the next three, four or five years, without the need to change the treaties. -Let’s talk about Spain. There are those who say that the Spanish economy is becoming Italianized, and that it is growing at a good pace despite the Government’s decisions. Do you share that analysis? -The Spanish economy has very positive dynamism and great activity in many sectors, despite political polarization and the problems caused by decentralization. And Spain not only has a dynamic economy, Spanish culture, tourism… are very attractive. -So much so that you are coming to Spain now.-Yes, at the end of November I am joining the Business Institute as dean of the IE School of Politics, Economics and Global Affairs and I am very excited about coming to Spain for many reasons: The Spanish economy is very dynamic and the Instituto de Empresa is a fantastic university with great global appeal and with students from all corners of the world. And when I announced to my contacts in the United States, Asia, Europe… that I was moving to Madrid, they all told me that it was a fantastic decision, which shows that Spain is a great country. Furthermore, I have been working for 25 years to strengthen the dialogue between Spain and Italy and this is a new opportunity. Now the Franco-German axis is very weak, it is going through many difficulties and I think it is a great opportunity for Spain and Italy to take over in Europe. -You have spoken about the polarization that exists in Spain, but it is not only a Spanish phenomenon. How does it affect economic development? -Polarization is a virus of Western democracy. It has spread in the United States, in France, in my country, … and it leads politicians, but also society, to not recognize the legitimacy of the other, of those who think differently and that is painful. For example, in the Italian parliament the most repeated word in the debates is “shame”, the contents of the Government’s or opposition’s proposals are not analyzed. Polarization is very negative for everything, for economic development but also for social coexistence and I don’t know how we can overcome it. But I’m not here to give advice. -I would ask you for one for Spain. We are growing more than the large European countries, but we top the OECD unemployment ranking, and especially among youth. What can we do to tackle this problem? -I believe that these problems need a European solution, because it is not just a problem for Spain. In all the meetings with young people that I held in different cities in Europe, I discovered that those who have ideas and projects want to go to the United States to seek financing and put them into action. Furthermore, unlike what happens in Europe, nothing happens there because a project fails, no one is stigmatized. In fact, the great advances in artificial intelligence in the United States are the result of several failed attempts. They have been able to understand that risk is part of life and that to have economic success you have to take risks. -Another problem that we share with Europe is immigration. An increasingly aging society like the European one needs immigrant labor, but at the same time we see how the rejection of immigrants is growing. -Populist parties have taken immigration as their banner and it happens in Europe, but also in the United States. . For me it is interesting what has happened with Brexit. The UK left the EU to control immigration, and yet they now have more illegal immigration than before, so Brussels is not the problem. It is a complex issue that, from my point of view, should not be treated in the same way in all EU countries. The same measures cannot be applied in Spain, France, Germany and Italy, which need immigration and are used to living with it, as in countries like Bulgaria, Poland or the Czech Republic, where they practically have ethnic homogeneity. I think there should be a solution at 27 but at different speeds. Large countries must take measures on the issue but without falling into populism, which only says how bad things are, but never provides solutions. -He has come to Seville to participate in the IV National Congress of Civil Society. Can civil society have a role in the transformation you propose? -I have participated in this congress because I believe that civil society must play a fundamental role at this time and is more integrated than politicians think. Civil society must convince their governments that the solution to national problems and Europe’s problems is not in fragmentation, but in integration and cooperation.
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